What happened?

In Creditsights Ltd v Dhunna the Court of Appeal restored an employment judge’s decision that the employment tribunal did not have jurisdiction to hear claims brought by an employee working abroad. Mr Dhunna was employed by the British company Creditsights Ltd (CSL) but worked in their Dubai office until he was summarily dismissed for alleged gross misconduct. Following this Mr Dhunna brought claims in the UK for unfair dismissal and breach of the right to be accompanied at a disciplinary hearing.

In concluding that there was no jurisdiction, the Court looked behind the set up of CSL’s Dubai office as a representative of the London office. Although this could have indicated a strong connection with the UK, in reality this set up was dictated by local legal requirements meaning that the company could not open a separate company in Dubai. Mr Dhunna had expressed that he was glad to be leaving the UK and that he hoped never to return. In addition to this he was paid in US dollars and if he had not been dismissed he would have moved to his employer’s Singapore office when it opened. All of these factors contributed to the decision that Mr Dhunna had moved from the UK and severed his links with it.

What does this mean?

This case illustrates the difficulties of addressing the issue of territorial jurisdiction. The general rule is that the place of employment is decisive when deciding where a claim should be brought. To override this Mr Dhunna needed to show a sufficiently “strong” relationship with the UK for the UK courts to have jurisdiction. The strength of an employee’s connection with the UK will be determined after a full analysis of the particular facts and the reality of the particular employee’s circumstances.

What should we do?

Employers should be aware of factors that the Court of Appeal considered in making its decision. Although Mr Dhunna was engaged under an English employment contract by a company incorporated in England and Wales this was not a compelling factor in his favour. For a claim of unfair dismissal to succeed, the claimant’s connection with Britain and British employment law must be strong enough for the Tribunal to consider that Parliament would have intended the protection to extend to the claimant. To prevent this connection being established, at the very minimum, employment contracts should state where an employee is based. However, arrangements in practice and the reasons behind them will also be highly relevant, as this case demonstrates.